Medicare vs Medicaid: what is the difference?

Two programs with different jobs

Medicare is the federal health insurance program for people 65 or older and for some younger people, such as those who get Social Security Disability Insurance or have End-Stage Renal Disease (kidney failure). Medicaid is run jointly by the federal government and each state, and it helps pay medical costs for certain people with low incomes, including older adults, people with disabilities, pregnant women, children and families. Because every state runs its own Medicaid program, the rules on who qualifies differ from one state to the next, and your income and savings have to fit your state's limits.

Medicare comes in parts. Part A is hospital insurance that mostly covers care as an inpatient, and Part B pays for outpatient care and services that help keep you healthy. Original Medicare works anywhere in the United States as long as the provider accepts Medicare.

Can you have both?

Yes. Someone who has Medicare and full-benefit Medicaid is called dually eligible, or a dual eligible. When you have both, Medicare pays first for Medicare-covered services. Medicaid pays after Medicare and any other coverage you have.

What Medicaid can add

Medicaid covers some things Medicare usually does not, such as nursing home care and personal care services. Depending on the level of Medicaid you qualify for, your state may also pay your share of Medicare costs, like deductibles, coinsurance and copayments. It can also pay for some drugs and services that fall outside Medicare.

Medicare Savings Programs are a kind of Medicaid that help pay the Part B premium, and sometimes other costs. Your local SHIP can help you apply. Our guide to Extra Help and Medicare Savings Programs explains how they work.

Spending down to qualify

If your income is above your state's Medicaid limit, some states let you “spend down.” You pay medical bills your coverage doesn't pay, along with cost sharing such as Medicare premiums and deductibles, until your remaining income is low enough to qualify.

How prescriptions are handled

With both programs, your prescriptions are covered by Medicare, not Medicaid. You are enrolled automatically in a Medicare drug plan. If Medicare does not cover a particular prescription, Medicaid may still cover it in some cases.

You still choose how you get Medicare

Having Medicaid does not take away your choice. You can get Medicare through Original Medicare or through a Medicare Advantage Plan. If you pick Medicare Advantage, there are special plans for dual eligibles that are built to make the services you need easier to get.

A new Medicaid work rule

Starting January 1, 2027, or earlier in some states, certain adults must spend at least 80 hours a month working or in other approved activities to qualify for Medicaid and keep it. This rule does not apply to people who have Medicare.

Common questions

Last reviewed October 2026. Medicare rules, dates and dollar amounts can change each year; Medicare.gov has the official details.